Last night I was watching the men’s 1000 meter Olympic speed skating event at the Winter Games. The defending Olympic champion, Shani Davis, dominated the field of skaters, winning the gold medal.

What was interesting to me was a remark by one of the television commentators. He said that Davis, an American citizen, lives and trains in Vancouver—just outside the Olympic Village—and that one of his good friends, Denny Morrison, is a member of the Canadian speed skating team. For two years before the Torino Games they trained together in Calgary, pushing each another to excel.

The commentator went on to say that, for competitive reasons, the coach of the Canadian team would not allow competing skaters to practice against the Canadian skaters before this year’s games. He suggested that this decision might have been short-sighted, as members of the Canadian team may have benefited from competition beyond what was comfortable and familiar to them.

That got me thinking about the nature of competition in business.

Intuitively, business operates with a scarcity mentality that suggests that there is a finite “pie” and that, if you get a larger slice of the pie, then I somehow get less. That’s why companies file patents and trademarks—to protect their intellectual property, conceal it from competitors, and use it to gain a competitive advantage in the marketplace.

The most successful businesses do not operate from a position of fear and scarcity. They lead from a position of confidence and abundance. These companies recognize that the “pie” is not finite. The size of your slice of the pie has little to do with the potential size of my slice because the pie has the capacity to grow exponentially.

This brings to mind an old Xerox print ad. In one frame, a little boy’s lemonade stand was suffering at the hands of a little girl’s competing lemonade stand, where a line had formed.

In the next frame, the boy had added a vase with a single rose to his lemonade stand and, to the girl’s dismay, the line had moved to her competitor’s stand.

The caption beneath the second frame read: “When companies compete, products get better.”

Whether in athletics, business, or another endeavor, competition is not something to fear and avoid. It should be welcomed and embraced. From a business perspective, all of us have something to learn from our competitors that will enable us to improve the product and service quality we deliver to customers.

What will your lesson be?

There’s a bagel restaurant in my neighborhood that posts a sign on its front door that reads, “No outside food or drink!” Apparently, the owner feels threatened by the Starbucks kiosk located inside the Albertsons supermarket next door.

The owner must think that by posting this sign he will deter the competition from cutting into his sales of high-margin lattes and espresso drinks. What he doesn’t realize is that people do not want to be forced to drink a mediocre alternative to their favorite coffee beverage.

The last time I bought a bagel in his shop was four years ago. At that time his sign was more specific and said something like, “No Starbucks beverages allowed on the premises!” It was such a turn-off to me.

I understand the owner’s underlying intent: to limit the erosion of his own beverage sales by keeping the competition’s beverages out of his sit-down bagel restaurant.

Ironically, the message had a different effect on me. I’d rather enjoy a good cup of coffee than eat one of his bagels. In fact, I presently drive to another bagel restaurant that is four miles further from my home. It also sells coffee and has a Starbucks retail store next door. The difference is that it does not censor the competition’s coffee.

I wonder what would happen if the bagel restaurant owner would remove the sign and accept (or at least tolerate) customers who entered the restaurant, Starbucks in hand, and ordered one of his bagels for dine-in?

On the one hand, bagel sales from people like me who resent the sign would increase. On the other, beverage sales might decrease due to granting customers the option to drink the competition’s coffee beverage on the premises while enjoying their bagel.

What might the owner do differently in order to address a situation where customers are consuming more beverages from Starbucks than from his own restaurant?

What if he invested in the quality of his coffee beverages to rival top brands such as Starbucks and Dunkin’ Donuts—who are renowned for their coffee? Perhaps he could then offer a complimentary 12 oz. refill to (in addition to customers who purchase his coffee) customers who come in with a coffee beverage from the competition.

Imagine the effect this could have. Customers who have never tried his coffee may, after sampling it, agree that it’s as good as or perhaps better than the coffee they ordinarily drink. Customers will appreciate the value they receive by enjoying a complimentary 12 oz. coffee refill. If the customers choose to remain at the restaurant rather than taking their refill to go, maybe they will order a second bagel or a muffin to enjoy as they linger?

Instead of putting up barriers to the competition and limiting customers’ freedom of choice, why not relax the barriers and let customers decide?